Radha Joshi

Australian department store chain Myer has reported a statutory net loss after tax of A$211.2m (US$140m) for fiscal 2025, largely due to a one-off impairment tied to its acquisition of Apparel Brands. The result was primarily driven by a A$213.3m non-cash impairment charge for Apparel Brands’ goodwill, coupled with A$34.7m in merger and restructuring costs. Stripping out these exceptional items, Myer’s underlying performance showed a net profit after tax of A$36.8m, though this was down from A$52.6m in FY24. Sales and Margins Hold Steady Despite a tough retail climate in Australia and New Zealand, Myer delivered modest sales growth. On a pro forma basis, including the first sales contribution from Apparel Brands, total sales rose 0.5%. The company’s operating gross profit reached A$1.4bn, helped by six months of Apparel Brands contributions, while the gross margin improved to 38.3%. However, earnings before interest and tax (EBIT) fell 13.8% to A$140.3m, reflecting the weight of restructuring costs and operational challenges. Operational Setbacks A key drag on performance came from Myer’s Melbourne distribution centre, which faced significant disruptions and cost the business an estimated A$16m. Executive chair Olivia Wirth acknowledged the challenges but stressed that the company has taken swift corrective action. “We took decisive action to address operational challenges, including completing a comprehensive review of our National Distribution Centre. We now have temporary measures in place to manage our next peak periods through Black Friday, Christmas and Boxing Day, and have developed a long-term solution. When fully operating, the NDC will underpin our omni-channel network strategy and deliver substantial cost and efficiency benefits.” Transition Year and Outlook Wirth described FY25 as a “transition year” for the group, noting that the company is laying the foundation for sustainable growth. “Despite challenging macroeconomic conditions and tough retail markets in Australia and New Zealand, we achieved positive sales growth in our first period as a combined group.” Looking ahead, early signs for FY26 are positive: in the first seven weeks, total sales rose 3.1% year-on-year. However, the company warned that rising operating costs will continue to pressure margins in the near term. The Bigger Picture While FY25 headlines are dominated by impairments and restructuring charges, Myer is positioning itself for a stronger future. The integration of Apparel Brands, improvements to distribution, and focus on omni-channel retailing signal a longer-term strategy. Investors and customers alike will be watching closely to see if Myer’s reset delivers the growth and efficiencies it is promising as FY26 unfolds.